Bitmain Holds Nearly 6% of Bitcoin Cash Supply, Accused of Price Manipulation for IPO

Published on by Cryptoslate | Published on

Surfaced documents suggest that Bitmain has accumulated nearly $1 billion worth of Bitcoin Cash, raising eyebrows over the cryptocurrency's role in a prospective $18 billion initial public offering.

If Bitcoin Core devs didn't disclose the Bcash vulnerability, it could've wiped a billion dollars off their balance sheets.

While the document cannot certify Bitmain's cashflow, the multinational appears to have been liquidating its holdings of Bitcoin to purchase vast quantities of Bitcoin Cash, the fourth largest cryptocurrency by market capitalization.

According to the investor deck, Beijing-based Bitmain has been steadily pouring its resources into Bitcoin Cash for years-having gone from holding zero BCH in December 2016 to a total of 1,021,316 in March 2018, or 5.9 percent of the circulating supply.

According to the document, in the first three months of 2018 the corporation purchased roughly $159 million worth of Bitcoin Cash, while it only sold $89 million worth of Bitcoin.

While such accusations are not to be taken lightly, Bitmain may stand to gain if investors believe the company commands such a substantial supply of BCH. On the cusp of a historic $18 billion IPO, one larger than Visa's, any ability to inflate the company's valuation may win over prospective investors.

Based on Bitmain's checkered relationship with Bitcoin Cash, this conclusion might not be seen as far-fetched.

In April, Bitmain-owned mining pool Antpool was alleged to have artificially pumped up the price of Bitcoin Cash by more than 25 percent after it announced it would be burning a portion of its mining rewards.

Having unsettled a number of community members in June when it mined 42 percent of all blocks on the Bitcoin network, Bitmain appears to have its sights firmly set on Bitcoin Cash.

Should Bitmain truly possess the ability to manipulate the price of BCH, the corporation appears to have unyielding power over two of the largest cryptocurrencies by market capitalization.

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